Normally, it’s viewed as a positive thing by the community as a whole when a city receives a sizable grant, especially when it comes with no strings attached.

But the owners of an airport shuttle business are not happy that Oak Harbor recently was awarded an $180,000 grant from the U.S. Department of Transportation’s Small Community Air Service Development Program, going as far as to accuse city leaders of breaking the law.

“The information that was stated in the grant application is both misleading and false,” said Michael Lauver, co-owner of Whidbey-SeaTac Shuttle, an Oak Harbor company that provides a van and bus shuttle service to Sea-Tac Airport. “Just submitting it is illegal.”

At last Wednesday’s City Council meeting, Oak Harbor City Administrator Paul Schmidt said he’s asked the consulting firm that wrote the application to examine Lauver’s claims. He said he’ll wait to get answers before asking the council to accept the grant award.

If the City Council ultimately accepts the money, it will be used to start a new van shuttle link between Whidbey Island Naval Air Station and the Oak Harbor Airport, also known as the Wes Lupien Airport, where Kenmore Air offers five round trips to Sea-Tac Airport, via Boeing Field. Also, a portion of the funds will be used to market the air service to sailors and the community at large.

“There is a real interest in keeping air service a viable link for Island County,” said Paul Schmidt, city administrator.

Indeed, the city, Island County, Island County Economic Development Council, Island County Joint Tourism and NAS Whidbey formed a partnership to support continued air service to the island. The partners worked together to win the grant, with support from senators Patty Murray and Maria Cantwell and Rep. Rick Larsen.

For many officials, retaining a functioning airport and air service is an important economic concern. The island went about five years without regular air service after Harbor Air ceased operations at the airport on Monroe Landing Road in 2001. Community leaders worked to recruit a new air carrier and ultimately Kenmore started operations in May of 2006.

Kenmore Air reduces flights

While Craig O’Neill, the marketing director for Kenmore Air, said the company has been very pleased with the support from the community, passenger levels are not up to historic levels. The airline reduced flights from seven to five. While about 60 percent of Harbor Air’s business was Navy-related, O’Neill said only about 30 percent of their current business is from Navy customers.

“There could be a lot of reasons for that,” he said. “The Navy has changed and the world has changed.”

To try to boost Navy participation, the city of Oak Harbor submitted the federal grant application last March. The city and Kenmore Air split the $10,000 price tag for hiring a consultant, the Seattle firm Bucher, Willis & Ratliff, Inc., to write the proposal. The consultant’s fee would have been less if it wasn’t successful.

While Kenmore Air and Whidbey Sea-Tac Shuttle are competitors, Lauver claims his objections to the grant has nothing to do with business.

“The issue is that what was stated as fact in the application does not come close to the truth,” he said.

At the meeting Wednesday night, Lauver described what he feels are “three areas of gross inaccuracies” in the application. He said including the territory from several of the San Juan Islands to Clinton as the airport’s “catchment area” is ridiculous. He argued that the application was erroneous in stating that certain Fidalgo Island businesses, such as the oil refineries, will suffer without air service out of Oak Harbor.

In addition, he claimed that the average national airfares cited in the document were wrong.

In an interview, Lauver also pointed out that the application details the supposedly limited alternatives to air service, but never mentions the shuttle service.

In a breakdown of costs, or “true average airfare,” the application offers just two alternatives for people driving to Sea-Tac; they both include the cost of a hotel at Sea-Tac the night before the flight, as well as the cost of long-term parking. Again, there’s no mention of the shuttle van or the fact that Whidbey residents usually don’t need to stay overnight at a hotel before a flight.

On the other hand, O’Neill doesn’t feel there’s anything wrong with the application. After all, the document is all about air service as an important alternative to driving. It’s not meant to be an end-all study on transportation options.

“I think we were validated in that the grant was awarded,” O’Neill said. Schmidt pointed out that it was a highly-competitive grant.

In fact, Lauver sent a letter to the U.S. Department of Transportation detailing his concerns with the application, but never heard back.

Lauver and his partner, John Solin, spoke vigorously at several recent Oak Harbor City Council meetings. They are upset about both the application and what they feel is the council’s and administration’s lack of communication and courtesy.

“They turned a blind eye to the facts in favor of fiction,” Lauver said.

Schmidt said the City Council will decide whether to accept the grant application at a future meeting. If they do, the city will send out requests for proposals to anyone interested in providing the service between the base and the Oak Harbor Airport. Under the proposal, the grant would subsidize the van service for two years at a cost of about $100,000; after that, the hope is the service would be self-sustaining.

In addition, about $80,000 would be used for a two-year, marketing support and service awareness program.

“This grant is not meant to support one carrier,” Schmidt said. “It’s meant to support the concept of air service on Whidbey Island.”

You can reach News-Times reporter Jessie Stensland at jstensland@whidbeynewstimes.com or call 675-6611.